Date 08 October 2013

1. SC Economic Development: Electrification Programme Ms Ayanda Noah Group Executive Distribution Date 08 October 2013

2. Content Orientation on the Electricity Value Chain Planning Principles Current Network Status Electrification Backlog Risks and Challenges Progressing Towards Universal Access 2

3. Transmission Substation Transmission Lines (400/275 kV) Electricity Generation Distribution Lines Distribution Substation Reticulation HV Line (11 & 22kV) Residential Reticulation LV Line (380/220V) The Electricity Supply Chain High voltage POWER STATIONS Industry, Mining & Large Metros Medium voltage Commercial/Small industry/ Farming/Small Munics Low voltage

4. Customer Services • Total electricity sales of 216 561GWh and 5 million customers (including transmission customers) as at 31 March 2013 • Supplies approximately 95% of South Africa’s electricity supply • Two main types of customers: • Redistributors: Mainly municipalities that sell electricity to end customers. • Direct customers: Industrial, commercial, mining, agricultural and residential consumers • Key Sales and Customer Service unit deals with customers using ≥100GWh of energy per year • As at 31 March 2013, Eskom had 5.0 million customers accounting for electricity revenues of R126.7 billion • One customer has a supply contract indexed to commodity prices • A member of Southern African Power Pool (“SAPP”) Key figures year end to 31 March 2013 Gross Electricity Revenue Split Total: 126.7 billion Number of customers Total: 5.0 million Electricity sales by customer for year ended 31 March 2013

5. Distribution: Division Profile Scope and mandate To service the customer through provision of reliable electricity by building, operating and maintaining distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving distribution industry issues and enhancing stakeholder relations Asset base Organisation structure • 67 488km of distribution lines • 269 535km of reticulation power lines • 6 960km of underground cables • 3 580MVA of new transformer capacity • 15 350 employees • 5.0 million customers nationally • • Nine provincial operating unit • Structures are now in place, • with fully functional management. Highlights and output Key challenges and priorities • Implemented several safety initiatives, which saw an improvement in most of the safety indicators • Sustained improvement of the system average interruption duration index (SAIDI) and the system average interruption frequency index (SAIFI) • Electrification connections exceeded target and also created 4 320 job opportunities • Since inception of the electrification programme in 1991, a total of more than 4.3 million (2012: 4.2 million) homes have been electrified • Employee and, in particular, contractor safety performance and lost-time injuries • High levels of theft of equipment and electricity, including illegal connections, affect network and service performance, increasing Eskom’s costs • Ageing networks, making maintenance a challenge 5

6. Distribution Network Planning Process • Comprehensive Network Planning process - Supported by appropriate Network Planning criteria/standards • Network Development Plans reviewed every three years (license condition) • Distribution Master Plans reviewed every 5 years • Ensure integrity of the design base – compliance assessed by Group Technology

7. Eskom Electrification Planning Principles -

8. Universal Access Workstream

9. Distribution Network Constraints Estimated cost to address capacity constrained networks R42.7bn February 2013 (as is network) • Planning Criteria assessed: • Voltage limits • Thermal limits • Maximum customer numbers • Maximum line lengths 1421 of a total of 8310 MV feeders fail Network Planning criteria (feeders in Red)

10. Distribution Current CAPEX Dx Wires m_report Dec 2012.pt

11. Electrification Highlights Since Inception + Eskom has made significant strides in connecting South Africans to the grid There have also been a limited number of off-grid connections • Added ~4.3 million households to the grid since 1990 • Electricity access has significantly increased from 1994 to-date: • Nationally from 36% to 83% • Rural electrification from 12% to 57% • Government’s target of 1.75 million connections between 1994 and 2000 exceeded through a self-funded and managed programme • Massive delivery • A connection every 30 seconds • A pole every 10 seconds • 200 metres of cable every minute • Eskom and Shell Joint Venture connected around 6,000 solar home systems between mid-1990s and mid-2000s • Nearly 32,000 systems have been installed by Non Grid Service Providers granted concessions by the DoE in 2003 SOURCE: Eskom

12. Electrification Success : Cumulative Connections

13. National Electrification Backlog (2012) 10.5% 21% 6.5% 5.5% 24% 6% 1.5% 5% 20% The national backlog, including municipal backlog is 3,3-million households, of which Eskom’s backlog in proclaimed areas is 1,8-million households, including estimated growth in the Western Cape, Gauteng and Free State. Eskom’s backlog in proclaimed and un-proclaimed areas is 2,3- to 2,5-million households (DoE figures). Stats SA Figures

14. The Household Back Log (Including Sub- letting residents) Sub-letting refers to units constructed on a property in addition to the main home or primary dwelling and are not on an individual plot or stand in the title scheme/cadastre, and can be located within, attached to, or separate from, the principal dwelling. Census 2011/12 Figures

15. Estimated Cost To Eradicate Backlog Per Province

16. Challenges To Achieving Universal Access • Increase of the cost per connection due to long Medium Voltage line (11 and 22KV ) • Project management & design skills shortage; • Sparsely populated rural areas; • Infrastructure projects in support of other implementing agents; • Municipal upgrades for After Diversity Maximum Demand (ADMD) • Constrain due to reduced Eskom Capex expenditure; • Refurbishment (Eskom funded) • Network Upgrade (Eskom funded) • Strengthening projects (Eskom funded) • New build (Funded by DoE 70/30 principle applies)

17. Some Opportunities To Facilitate UAP Achievement • Grid & non-grid, Master Plan (DoE & Eskom working on a Master Plan); • Agreed service levels of the non grid to be similar to grid; • Harmonization of government initiatives e.g. electrification and housing programmes • Aligned policies to facilitate implementation process (e.g. un-proclaimed, land usages); • Installation of two meters in double stand dwellers; • Increase fund allocation to cater for infrastructure projects: • Refurbishment of constraint networks related to electrification. • Upgrading of the networks. • 70/30 principle in new builds networks to be continued.

18. Single homestead in a mountain(High cost per connection)

19. Cost per connection in Densely populated area is low

20. The elect. challenge is Real & Material The burden falls disproportionately on women and girls TThe girl child & her mom are still fetching wood to cook & keep warm

21. Universal Access Programme Thank you